Mitsubishi Tokyo Financial Group Inc. plans to inject some 300 billion yen in capital into UFJ Holdings Inc. by September to help the UFJ group accelerate disposal of bad loans ahead of their planned merger in the first half of fiscal 2005, according to financial sources.
Mitsubishi Tokyo and UFJ announced Friday they have signed a memorandum of understanding to launch negotiations with the aim of integrating their operations during the April-September period of 2005.
The merger would create the world's biggest banking group, with total assets of 190 trillion yen, topping the 135 trillion yen of Mizuho Financial Group Inc.
The financial sources said that Mitsubishi Tokyo plans to help UFJ Holdings increase its capital by 300 billion yen and accelerate its bad-loan disposal ahead of the merger.
The UFJ group initially planned to sell UFJ Trust Bank to Sumitomo Trust & Banking Co. in a 300 billion yen deal but balked because of the planned Mitsubishi Tokyo-UFJ merger.